Medical billing, a world of hurt

CLEVELAND, Ohio -- Reading a medical bill can feel like trying to solve a puzzle -- and determining whether something listed is accurate or a mistake can take multiple phone calls to an insurance company, hospital, doctor's office or laboratory.

An estimated 16 percent of consumers nationally don't understand bill descriptions of procedures they received, according to a 2010 national survey by Intuit, a financial software company. In a 2011 survey, Intuit found that 41 percent of consumers do not have confidence that the amount they were billed was correct.

Stephen Parente, a professor of health finance and insurance at the University of Minnesota, estimates that up to 40 percent of the claims between providers (such as hospitals and doctors) and payers (such as insurance companies) have mistakes.

For example, said Parente, who analyzed commercial insurance claims as part of a study, "Somebody didn't put on the right diagnosis code or didn't put on a diagnosis code at all."

Here are a few of the common billing problems consumers confront.

Unknown prices: The cost of a treatment can vary widely from hospital to hospital and is seldom provided upfront.

"The state of Ohio does not tell hospitals and doctors how to bill their patients," Cataline explained. "In Massachusetts, they regulate what you charge."

In Ohio, hospitals are required to provide an annual list of charges for room and board, and for emergency-department, operating-room and other procedures. For example, the listed price for a cesarean section delivery at University Hospitals Case Medical Center is $4,278. The Cleveland Clinic's Hillcrest Hospital charges $3,734. The Ohio Hospital Association's Patient Price Information List is available online.

But that information, as hospital administrators will be the first to say, is not necessarily what a patient will be charged. Patient bills vary depending on insurance coverage. In addition, the price list provides a standard charge and may not match because of complications or other services provided. And of course there are separate charges for physician services, drugs, supplies, etc.

Hidden costs: Unexpected charges, though legal, can catch consumers off guard and seem less than fair, said Mark Rukavina, director of the Boston-based Access Project, which helps consumers with medical bills and the often-resulting debt.

"Generally, the language in bills and EOBs [explanation of benefits] is not easy to understand," Rukavina said. "You need to do some sleuthing on that to figure out whether there is an error."

For example, patients can legally be charged a "facility fee," which hospitals and physicians attach to bills to help pay for the cost of providing a place of care. The national trend of hospitals charging facility fees came to Northeast Ohio in 2009. Patient bills from the Cleveland Clinic, MetroHealth Medical Center, University Hospitals Case Medical Center and other hospitals in Northeast Ohio now include the charge. However, the charge may not be clearly identified.

Upcoding and unbundling: Some unexpected fees should be considered errors or possibly fraudulent, said Rukavina.

The practice of "upcoding," or changing a code to represent a more severe diagnosis or treatment, can inflate a patient's bill. Some examples of this include coding for the use of a name-brand medicine rather than the generic that was provided, or listing an office visit as an urgent-care or inpatient visit.

Hospitals and physicians nationwide have faced scrutiny from regulators for using improper billing codes and techniques when seeking reimbursement from government payers Medicare and Medicaid. In March, for example, Baltimore's Good Samaritan Hospital agreed to pay $800,000 to settle allegations that it submitted fraudulent claims to federal regulators that asked for reimbursement for conditions that were not actually diagnosed or treated.

There is also the possibility that a doctor or hospital has purposefully or mistakenly "unbundled" codes that relate to a patient's care. Unbundling is when multiple procedure codes that deal with the one treatment are listed with separate charges, when they could have been listed at one, lower package rate.

Balanced billing: Have you ever received a bill asking you to pay the difference between a doctor's charge and the amount negotiated between the insurance company and the health care provider? If so, then you've been "balanced billed."

The controversial practice came under fire several years ago, and states have largely stepped up to make it illegal.

Ohio's laws prohibit balanced billing for most patients. Still, people who are enrolled in a health insurance PPO (preferred provider organization) but go outside the network to see a doctor or visit a facility can legally be billed for the amount that wasn't covered by insurance. In addition, anyone who has an indemnity policy, which allows patients to go to any doctor at any time, can be billed for the amount not covered by the insurer.

Still, national health insurer Aetna continues to battle doctors over the practice. Earlier this year, Aetna filed suit against doctors in New York for overcharging its members.

"I have a team that we're just starting up now to help our legal folks to deal with the bill providers," said Akron native Shelly Ferensic, who is vice president of operations, including claims at Aetna.

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